Toyota Motor plans to launch a battery powered, medium segment passenger car in China late next year, helped by sourcing key technology from local automaker BYD Auto, according to a Reuters report.

The Japanese automaker has stepped up efforts in the last year to play its part in the global electric vehicle (EV) revolution, having just announced a major new US$1.3bn EV battery plant in the US.

But the company is still seen as a laggard in this segment, having focused significant efforts in recent years on hybrid technology and on developing hydrogen as the fuel of the future.

The automaker has set up a dedicated zero emissions division in Japan, called ZEV Factory, which is focused, among other things, on developing safer and lower cost battery technology including solid state lithium ion cells.

Toyota established a research and development joint venture with BYD last year, called BYD Toyota EV Technology, which is understood to employ 24 Toyota engineers working alongside 100 BYD staff in Shenzhen.

The Reuters report suggested Toyota was planning to launch a “small and affordable electric sedan in China late next year” using key BYD battery technology to help it “make an affordable yet roomy run around” for the local market.

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According to the reports, Toyota would source BYD’s less bulky blade shaped battery cells based on lithium iron phosphate (LFP) chemistry, a technology that has been improved significantly in recent years.

The BYD batteries would help Toyota keep costs down, according to an unnamed company executive.

The forthcoming Toyota EV was said to be slightly bigger than the current Corolla, with a targeted retail price of less than CNY200,000 (US$31,000), cheaper than similar size Tesla and Nio premium sedans.

The model was expected to be unveiled as a concept car at the Beijing auto show next April and would likely be launched locally as the second model in Toyota’s bZ EV range.

It was unclear if or when the model would be sold outside of China.

A Toyota spokesman said: “We don’t comment on future products. Toyota considers battery electric vehicles as one path to help us get to carbon neutrality and is engaged in the development of all types of electrified vehicle solutions.”